This rural provider is expanding services in its community.

Healthcare is a difficult industry, whether in a rural environment or an urban center. But the challenges can be different. Gary Riedmann, CEO of St. Anthony Regional Hospital and Nursing Home in Carroll, Iowa, knows the reality facilities like St. Anthony face.

Gary Riedmann, CEO

St. Anthony’s board knew building a regional health center was easier said than done, so about 15 years ago, the hospital began an ambitious plan to increase the percentage of the community it served. But first it needed to expand and modernize programs and services, attract more doctors and nurses, and figure out how to pay for it.

The reasoning behind the expansion plan was simple. With about 90,000 people in its primary and secondary areas, there was a regional need. Historically, people had to drive for hours to get anything other than primary care.

St. Anthony embarked on an aggressive campaign to bring in new doctors and specialty services and expand and upgrade facilities—all while remaining fiscally conservative. Among the improvements, St. Anthony created a cancer center and a dialysis center. In the last 10 years, the hospitals general surgical services doubled, and despite a 1% decrease in the population, the hospital’s OB services increased by 40%.

The hospital also increased its staffing from 350 employees in the early 1990s to 610 today, and the number of physicians grew from 12 to more than 30, despite the difficulty of physician recruitment for rural hospitals. It has also increased its nursing staff and is developing a regional education center to provide additional hands-on training, including a SimMan.

St. Anthony also invested in its facilities. A new education center will be located above the new surgery center, and the $25 million project is to be completed between 2008 and 2009. In 2006, the hospital also completed a project to improve its inpatient care facilities and make all hospital rooms private, but this is still just the beginning of a process that has cost the hospital $120 million so far.

“One of the challenges we know is coming will be with information systems. EMR’s are certainly a part of our future,” said Riedmann, indicating projects such as renovating the ED, expanding the cardiac care service, and developing a specialized orthopedic unit are also down the line. “We’re moving cautiously and trying to complete our projects without wasting time, money, and energy.”

Helping hands
St. Anthony would not have gotten far without community support, but it needed to engage the community in a way urban hospitals are not always able to. Without community backing and capital contributions, these projects might have stalled. Riedmann and his team needed to know their efforts to create this regional center would result in the volume increase the board envisioned.

Rather than allocate funds for a massive advertising budget, Riedmann and other members of St. Anthony’s leadership team meet regularly over breakfast or lunch with small groups of people from the community. The hospital leaders let the people know what the plans and objectives are, and the people are given the opportunity to voice their concerns and suggestions. They have been doing this about six times a month since they first decided to expand, and it has created a tight bond between St. Anthony and the people it wants to serve.

“There is nothing like personal contact. People talking to their neighbors and friends about us will make the difference in who comes to us,” Riedmann said. “Our marketing techniques aren’t the same as those of an urban center. We want people to talk to us face to face about our plans to get their feelings about our services.”

But it has been more than just sit down meetings. St. Anthony has also been fortunate that, despite the fact it is in a small town of 10,000, in the last seven years, it has had two capital campaigns of over $3 million, with another one for $1 million currently underway.

St. Anthony has shown patience, slowly growing for more than a decade. By spending three to four years improving each of the new services it has added, St. Anthony has also improved its quality of care.

St. Anthony’s board is a mixture of people with business and political experience and the Franciscan Sisters of Perpetual Adoration from LaCrosse, Wis., and its senior staff averages 12 years with St. Anthony. This management structure gives the organization a good understanding of the healthcare industry, with a mixture of business savvy and a dedication to its mission.

“We have focused on service excellence so the renovations would make a difference. We’ve determined what the community’s needs are, what the financial risks are, and what our mission tell us,” Riedmann said.

With industry costs a major concern for all providers, Riedmann knows he needs to keep a close eye on the hospital’s finances. He described the uncertainty of Medicare reimbursements as a major challenge, especially in Iowa, which is near the bottom for national reimbursement levels. According to Riedmann, St. Anthony is also a tweener, taking in fewer reimbursement dollars than urban centers and critical access centers. The hospital has also spent almost $2.5 million on charity care for the poor and uninsured. Though these factors are a concern, Riedmann’s team is ready to face them.

“We know reimbursement will be tight, so we are focused on deferred giving programs with our community. We have to keep our overhead tight and focus on building our numbers and volumes in profitable areas like surgery,” said Riedmann. “We are developing programs to allow us to plan and support the future of St. Anthony when financial changes come, so we will have the resources to weather that storm.”